Citation Nr: 21072422 Decision Date: 12/03/21 Archive Date: 12/03/21 DOCKET NO. 19-18 841 DATE: December 3, 2021 ORDER The termination of the appellant's apportionment on behalf of the minor child, P.K., was improper, and restoration in the amount of the dependency allowance the Veteran receives for one dependent child is granted. FINDINGS OF FACT 1. P.K. is the Veteran's biological child. 2. The appellant is the legal guardian of P.K. 3. The appellant has demonstrated financial hardship as her expenses generally exceed her income. 4. A special apportionment of the Veteran's VA disability compensation benefits, in the amount of the dependency allowance that he receives for one dependent child, would not create an undue financial hardship to the Veteran. CONCLUSION OF LAW The criteria for a special apportionment of the Veteran's VA compensation benefits to the appellant on behalf of P.K., in the amount of the dependency allowance that he receives for one dependent child, have been met. 38 U.S.C. § 5307 (2012); 38 C.F.R. § 3.450, 3.451, 3.452, 3.453, 3.458, 3.503, 3.667 (2021). REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veteran served on active duty from May 1987 to August 2007. The appellant is the mother of his minor child, P.K. This matter comes before the Board of Veterans' Appeals (Board) from a November 2018 apportionment decision of the VA Regional Office (RO). In March 2020 and June 2021, the Board remanded this matter for further development, to include compliance with contested claims procedures. The termination of the apportionment of the Veteran's VA compensation benefits to the appellant, on behalf of the minor child, P.K. The appellant seeks restoration of the apportionment of the Veteran's VA disability benefits in the amount of $371 or more per month to the appellant on behalf of the Veteran's minor child, P.K. VA regulations provide for two types of apportionments. The first type is a "general" apportionment, which may be paid under the circumstances set forth in 38 C.F.R. § 3.450. More specifically, all or any part of the compensation payable on account of any Veteran may be apportioned if the Veteran is not residing with his spouse or children, and the Veteran is not reasonably discharging his responsibility for the spouse's or children's support. 38 U.S.C. § 5307(a)(2); 38 C.F.R. § 3.450(a)(1)(ii). No apportionment will be made where the Veteran is providing for his dependents. 38 C.F.R. § 3.450(c). It is not necessary for the claimant to establish the existence of hardship in order to obtain an apportionment under 38 C.F.R. § 3.450. See Hall v. Brown, 5 Vet. App. 294 (1993). The second type is a "special" apportionment. Under this type of apportionment, without regard to any other provision regarding apportionment, where hardship is shown to exist, compensation may be specially apportioned between the Veteran and his dependents on the basis of the facts of the individual case as long as it does not cause undue hardship to the other persons in interest. In determining the basis for special apportionment, consideration is to be given to such factors as the amount of VA benefits payable, other income and resources of the Veteran and those dependents in whose behalf the apportionment is claimed, and the special needs of the Veteran, his dependents, and the apportionment claimants. The amount apportioned should generally be consistent with the total number of dependents involved. Ordinarily, apportionment of more than 50 percent of the Veteran's benefits would constitute undue hardship on him or her, while apportionment of less than 20 percent of his or her benefits would not provide a reasonable amount for any apportionee. 38 C.F.R. § 3.451. A veteran cannot prevail on a claim of hardship when he or she is receiving additional benefit for a dependent and the apportioned amount is no more than that additional benefits. See Hall, 5 Vet. App. at 295. Both types of apportionments (either "general" or "special" apportionment) are payable to a spouse or a dependent. 38 U.S.C. § 5307(a)(2); 38 C.F.R. §§ 3.450(a)(1)(ii), 3.451. A Veteran's benefits may be apportioned if a veteran is not residing with his spouse or children, and a claim for apportionment is filed for or on behalf of the spouse or children. 38 C.F.R. § 3.452(a). A veteran's benefits will not be apportioned where the total benefit payable to the disabled person does not permit payment of a reasonable amount to any apportionee. 38 C.F.R. § 3.458(a). The "benefit-of-the-doubt rule" rule does not apply in apportionment cases because it is impossible to give the benefit of the doubt to a veteran and a claimant simultaneously. Elias v. Brown, 10 Vet. App. 259 (1997). Historically, a February 2014 decision granted an apportionment of the Veteran's VA disability benefits in the amount of $371 per month from effective December 1, 2008. From 2014 to 2018, the Appellant requested an increase in the apportionment amount several times but was ultimately denied. In April 2018, the Veteran requested termination of the apportionment because he has been unemployed for several years and the apportionment caused financial hardship. See April 2018 Veteran's statement. In June 2018, the appellant was notified of the proposed termination of the apportionment. The November 2018 decision on appeal terminated the apportionment based on a finding that the Veteran was reasonably providing support for P.K. because she was receiving contributions garnished from the Veteran's retirement pay and a continued apportionment was causing hardship to the Veteran. In December 2018, the appellant filed a notice of disagreement appealing the November 2018 decision to terminate the apportionment. For the reasons set forth below, the Board finds that the evidence weighs in favor of finding that the decision to terminate the apportionment of the Veteran's VA benefits to the appellant on behalf P.K. was not proper. However, the Board further finds that an award of the full $371.00 would cause hardship to the Veteran. Therefore, the apportionment in the amount of the additional dependency allowance awarded to the Veteran on behalf of P.K. is, therefore, granted. Initially, the Board finds that throughout the relevant period on appeal, the Veteran has been reasonably discharging his responsibility to his dependent child, P.K. The record reflects that the Veteran's retirement has been garnished in the approximate amount of $475.00 per month. See May 2020 County of San Diego Child Support Services letter, June 2020 Appellant's report of financial status, and June 2020 Veteran's report of financial status. Based on the foregoing, the Board finds that the Veteran has been reasonably discharging his responsibility for P.K.'s support through monthly deductions of his retirement income. Therefore, the Board must find that a general apportionment would not have been warranted during the relevant period of the claim. Having determined that the appellant is not entitled to a general apportionment, the Board must now determine whether entitlement to a special apportionment is warranted. After a review of all the evidence, the Board finds that a special apportionment of the Veteran's VA disability benefits is warranted, and that the apportionment in the amount of the additional dependency allowance granted on behalf of the Veteran's dependent child, P.K, is to be restored. Court documents indicate that the Veteran's Benefits were to be withheld in the amount of $1661.00 for current child support and $225.00 per month for past due child support. See February 2019 Amended Income Withholding Order. In April 2019, the Los Angeles Regional Office noted that the maximum withholding allowed by law had been reached and no further withholding would be processed. There is no evidence of record that the Veteran has been providing child support at this level of support. In June 2020, the appellant submitted a letter requesting that the VA resort the $371.00 per month payment that was terminated and requested a payment increase to 50 percent of the Veteran's monthly benefit. The appellant further noted that the Veteran owed nearly $100,000.00 in arrears and requested a lump sum payment of the principal and interest balance. She stated that she receives minimal financial support from the Veteran. On her June 2020 VA Form 5655, the appellant reported total household income of $2,440.00 per month, and total monthly expenses of $2750.00. As such, the appellant and her child's monthly expenses exceeded their monthly income by approximately $310.00. She also reported that she did not otherwise have any net worth, to include from bank accounts, retirement accounts, stocks, or other property. Based on the foregoing, the Board finds that the appellant has demonstrated financial hardship because throughout the period on appeal her expenses exceeded her income. Because the appellant has demonstrated financial hardship, the Board will now analyze if restoration of the apportionment in the amount of $371.00 per month would create an undue hardship to the Veteran. On the Veteran's June 2020 VA Form 5655 Financial Status Report, the Veteran reported a total monthly net income of $4,118.21 and total monthly expenses of $4,599.65. As such, the Veteran's monthly expenses exceeded his income by $481.44. Thus, in consideration of the Veteran's current financial obligations, an apportionment at the rate of $371.00 per month would also cause financial hardship. After a review of all the evidence, the Board finds that a special apportionment of the Veteran's VA disability compensation benefits, in the amount of dependency benefits received for one minor child, to the appellant on behalf of P.K. is warranted. This amount is equivalent to the additional dependency allowance the Veteran receives for P.K. The Board notes the Veteran cannot prevail on a claim of hardship when he is receiving additional benefits for his dependents and the apportioned amount is no more than the additional benefits. See Hall v. Brown, 5 Vet. App. 294, 295 (1993). The Board acknowledges the appellant's request to be paid a lump sum for past due child support benefits. The Board notes it is not within the regulatory discretion of the Board to award such a payment under these circumstances. (Continued on the next page) Based on the foregoing, the Board finds that the appellant has demonstrated financial hardship, and an apportionment of the Veteran's VA disability compensation benefits in the amount of dependency benefits received for the minor child would not cause the Veteran undue financial hardship. As such, the Board finds that an apportionment of the Veteran's VA disability compensation benefits to the appellant, in the amount of the dependency benefits received for one dependent child, is warranted. A. S. CARACCIOLO Veterans Law Judge Board of Veterans' Appeals Attorney for the Board Laura C. Owens The Board's decision in this case is binding only with respect to the instant matter decided. This decision is not precedential and does not establish VA policies or interpretations of general applicability. 38 C.F.R. § 20.1303.